1st Trade on Hammer

28/07/09 1830
Eur/Jpy 1 HR Chart

Previous candle show a hammer which shadow is twice the body. Went for a long trade @ 135.22 with stop at 134.84 which is 10 pips away for the low of the hammer. Profit targeted at 135.60 which is the previous resistance line. Stop was hit at 1945.


Note
The Hammer was the 2nd candle of a down trend and to confirm a trend, there must be at least 3 candle in the same direction.
The candle before the Hammer wraps around 3 white candle suggesting the market to go down further.
Profit vs loss = 82 vs -62


2.
28/07/09 1930
Eur/Jpy 1 HR Chart

Immediately after the previous trade, i came across another trading opportunity. As the market hit the previous support and i go for a short trade at 135.02 with the stop loss at the high of that lowest candle which is 135.30. Profit targeted at previous Support and resistance line at 134.40


Note
Trade was successful
Didn't spot the correct support line, went for the previous low at 134.24 at first and realised after that.